Month: January 2015

The Sundarbans mangrove forest is struggling to survive a 350,000 liter oil spill. On 9 December 2014, the oil tanker carrying more than 350,000 liters (92,500 gallons) of bunker oil sank on a major river, called Shela, flowing through the Sundarbans after being hit by a cargo vessel. Its been nearly two months and the threats are yet to be over.

Rare animals and wild bird died by oil spill in the Sundarbans. Photo by Anup Kundus 28 Jan 2015.

Sundarbans, a UNESCO-projected World Heritage site that is the largest remaining mangrove forest in the world, has saved millions of Bangladeshi lives by offering critical protection against devastating cyclones. It provides a vital habitat for many rare and endangered species, sequester carbon, and serve as a life-saving buffer against the devastating tropical storms that are increasing in frequency and intensity with global warming. But the massive oil spill from a tanker accident has spelled disaster for its delicate ecology. Officials said that the slick had spread over up to 70 kilometers (45 miles) of the Shela river, a major sanctuary for aquatic animals in the Sundarbans. At least 20 canals connected with the Shela as well as another major river, Pashur, have also been affected.

To make it worse, Indian corporations are pushing the government in Bangladesh for other commercial projects like the Rampal coal plant which, they call, a Bangladesh India Friendship Power Company (BIFPC),which pose further huge threats to the Sundarbans.The proposed coal-fired power plant at Rampal, just 14 km, from the Sundarbans Reserve Forest, would destroy a vital habitat for many rare and endangered species, and million of Bangladeshi people.Thus the next accident is right around the corner unless we are able to form a global movement, joining the hands of national and local struggles against this corporate grabbing in Bangladesh. The Bangladesh government is relentlessly pursuing major industrial projects like the 1320 megawatt Rampal coal plant that will generate enormous volumes of toxic waste and leave the forest waterways vulnerable to future hazardous spills.

Common people in Bangladesh are deeply concerned to the threats, and the majority of Bangladeshis are desperate to save the Sundarbans. On 6 February, the Bangladesh National Committee is holding a convention in Dhaka to address the gravity of the concerns and associated threats to the Sundarbans. The National Committee has declared a 5-day nationwide long march from Dhaka to Sundarbans which will be held in mid-March to re-mobilise peoples voices against this devastating project.

As our friends at Avaaz points out, UNESCO is concerned about the situation, and if enough of us raise our voices now, we can persuade them toofficially declare the Sundarbans as a “World Heritage in Danger” and force the Bangladesh government to protect the forest. Let’s sign the petition of Avaaz.org. whilst sharing news of protests in Bangladesh and beyond.

Phulbari is not a controversy. It is the name and symbol of a successful resistance by community people threatened with displacement by a proposed open-pit coal mine by GCM Resources in 5,600 hectares of land (including arable land with high cropping intensity) in four thanas of Dinajpur. Open mining requires stripping off the soil over the deposit that lies at least 150 meter or deeper (upto270 meters) under the earth. The mining company has changed its names twice after a community protest rally against the Phulbari project was attacked and protestors shot at, killing three young protestors in 2006.

Although the company’s revised documents say that the stripping will be done in phases, two highly placed government-led expert committees were not convinced in favour of the mine that will directly affect the lives and livelihoods of at least 1,00,000 people (2006). Foreign environmental experts extensively criticised the company’s Environmental Impact Assessment for being incomplete and vague. The human displacement and environmental costs are so high that United Nations’ rapporteurs also made statements expressing opposition to the proposed mine.

‘Self-proclaimed’ or not, local communities and environmental justice platforms like the National Committee to Protect Oil, Gas, Mineral Resources, Power and Port must have had logical objections against the proposed project; why else would international financiers like the Asian Development Bank and Barclays Capital feel compelled to withdraw their financial support from the project since 2008? Long before the incident of November 24, 2014, the project based in London Stock Exchange’s Alternative Investment Market had been termed ‘risky’ by industry experts like Rosie Carr in 2006 (Identify the Risks, The Investors’ Chronicle, the Financial Times).

My own doctoral research from the University of Oxford quantitatively compared incidences of community-based protests against 398 open-pit mines in South Asia. Factors like density of population, proportion of area under forest cover, and ownership by a multinational company predicted the highest probability of protest in the proposed Phulbari deposit. This research result was formally conveyed to the shareholders of GCM in their Annual General Meeting of 2011. This means that the investors are well aware of the financial risks they are taking by investing in the Phulbari project.

When such a volatile project with a high degree of environmental, political and social risks and very strong local-national-transnational opposition is supported by a quarter, what I see is unfettered greed of profiteering by some people with no environmental, social and cultural conscience at all. No matter how strongly the locals protest it, or how persuasively the experts explain that the mine would be devastating for the water aquifers, for example, they will not stop. Because they do not care about Bangladesh or its FDI rates; they are only worried about their profit, with every pence increasing their share value in the AIM. The ranting of these ‘investors’ about our country and our politicians in their discussion forums clearly show that all they care about is profiteering through stock manipulation in London that is independent of what the marginalised protestors at Phulbari do or do not do.

Placard used in a protest against the exploitative British company. Photo: Golam Rabbani

The company, as erroneously suggested by some, does NOT have a ‘permission for mining’ yet from the government. A letter from the government that is often used as an evidence of contract clearly states that the permission to mine is dependent on the following: “on receipt of the Feasibility Study Report, the technical aspects of the project will be examined and evaluated by experts and on the basis of this government will take final decision regarding real mining operation…Within this time, the lessee will not conduct any commercial activities of the mine.” On one hand, the expert committee formed after this letter expressed opposition to the project, and on the other, the Phulbari Chukti that said ‘no open mine anywhere in the country’ was signed by the BNP-led government representatives in 2006 and was supported by the then opposition leader Sheikh Hasina. It is an obligation for any incumbent politician to uphold these.

The local resistance started in 2005, gathered momentum and peaked in 2006. National committee joined the locals later to support their resistance. The locals successfully showed how the mine was not only threatening for them but also for our national interest. It wouldonly benefit the company as it would have owned all the coal, giving a small amount of royalty to Bangladesh (much lower than the convention) and some supply of coal for our power generation. 80% of the coal produced was earmarked for export to India through a very vulnerable eco-system in Southern Bangladesh — the Sundarbans. The far-reaching probable effect of this on the mangrove forest is probably clearer now after the oil tanker spill in Shela river in December 2014.

There exist several doctoral and post-graduate dissertation-based research from well-reputed western universities like Chicago, Sussex, Amsterdam, and faculty and NGO level research in Bangladesh, UK and USA, that show how strong the opposition against the mining project is and why it is the case: too costly for communities due to huge displacement, high environmental risk in a riverine area like Bangladesh where any seepage or extraction of water table has a far reaching environmental impact and increase in food insecurity with the loss of highly active arable land to the mine. All these for whose benefit: to produce electricity to export to India! Farewell to national interest, eh?

Last but not the least, FDI inflow increased 98% over the last fiscal year according to the Board of

Bangladeshi activist protests against the company outside the AGM. Photo: Paul V Dudman

Investments’ own records, which proves that although Phulbari is in stalemate for the last 8 years, the national investment scenario looks pretty good. I am no economist but my common sense suggests that first, foreign investment depends on global trends and is therefore dependent more on global crises than one single project. Second, GCM’s investment is not that big given the country’s whole investment scenario. Third, there are other more profitable sectors in the country where foreign investment is less risky and better-suited for investors who care for long-term returns rather than the short term return required by GCM’s short-sighted investors, whom I closely observed for one year in 2010-11. Finally, increase in FDI in power sector without a concern for sustainable growth often is responsible for creating a ‘resource curse.’ Experiences of countries like Nigeria, Sudan, Columbia and Afghanistan tell us how an increase in FDI in the energy sector negatively trapped the countries into poverty and dependence. Are we to welcome any investment that intends to export our resources at high financial, environmental and social cost and benefit only a few investors and some corrupt government officials? Or are we to bid farewell to the bad investments and welcome those that propose to extract responsibly keeping in mind the prospect of future generations to come?

The writer is Assistant Professor of Sociology, University of Dhaka. She earned her doctorate from the University of Oxford, UK, in 2013 on the Phulbari Resistance. The research was funded by the Commonwealth Commission.

The op-ed piece (‘Farewell to FDI?’,The Daily Star, Jan 13, 2015) is based on some misleading and partial information regarding Asia Energy’s (GCM) Phulbari Coal Project and the peoples’ protest against it. The writer termed the peoples’ protest against Asia Energy chief’s visit to Phulbari as ‘vandalism’ but did not mention how, for a long time, Asia Energy has been trying to bribe the local youth, provide them with drugs and destabilise the local situation. He blamed the government and local administration for not taking action against the protesters and warned that this might harm foreign investment, without even mentioning the responsibility of the government to implement the Phulbari agreement signed with the local people and honour expert opinion against open pit mining on different occasions.

The writer declared the government official’s denial of existence of mining contract with Asia Energy as “erroneous,” as he completely relied on Asia Energy propaganda published in Energy & Power, but failed to present the correct picture based on original documents and experts’ opinion already submitted to the government.

Based on the article ‘Records Need making Straight’, published in Energy & Power, widely known as lobbyist of Asia Energy, the writer states that Asia Energy has valid contract for mining with the government of Bangladesh and it obtained ‘mining lease’ in April 2004. But the April 2004 letter, which the Energy & Power article referred to as evidence of Asia Energy’s mining contract, was indeed issued “…in the interest of preparing feasibility report and submitting to the government” and in no way can be used as a valid contract for mining operation. It was very clear in its following statement:

“(c) On receipt of the Feasibility Study Report, the technical aspects of the project will be examined and evaluated by experts and on the basis of this government will take final decision regarding real mining operation.

(d) Within this time, the lessee will not conduct any commercial activities of the mine.” (Emphasis added)

He also missed the evaluation and recommendation of the expert committee (formed by the government and headed by Prof. Nurul Islam) on the development plan submitted by Asia Energy. The expert committee in its report rejected the development plan of Asia Energy saying that:

According to the Mines and Minerals Rules prepared in 1968 under East Pakistan Mines & Minerals act 1967 (Regulation & Development) and amended in 1987 and 1989, royalty rate was fixed at 20% of the price of produced coal at the mine mouth. Accordingly, the Bureau of Mineral Development (BMD) signed an agreement for Boropukuria coalmine on 10/07/1994 at 20% royalty rate. Yet, on 20/08/1994, only a month and ten days after having signed this agreement, the BMD signed another agreement with BHP for coal mining in Dinajpur and Rangpur areas at only 6% royalty rate. This agreement with BHP is illegal as per the then existing mining law. In this situation, this illegal contract may be declared invalid and steps should be taken against concerned persons according to Article 5 of Mines and Mineral Act 1992.

According to Article 32 of Mines and Mineral rules 1968, which was in effect during the signing of the contract, as 3 years had already passed after first issuance of the license, the authorities did not have any right to extend the license period beyond 15/01/1998. For that reason the license renewal order on 26/01/98 for Area ‘B’ was illegal. During handover of the license for Area ‘B’ under the Assignment Contract [the transfer of contract from BHP to Asia Energy], BHP did not have any valid license to transfer as the license was already expired. That’s why all actions taken by the Asia Energy in that block are illegal. BHP lost permission for all kind of activities in Block ‘B’ on 15/01/98 in consequence of which Asia Energy did not have any valid permission to work in that block. So Asia Energy never had any right to apply for mining lease.

For the above two reasons, the Assignment contract signed with Asia Energy on 11/02/1998 has no legal basis. Alternatively, if it is considered that the application for the mining lease will be operated under Mining Rules amended in 1995, the government still cannot consider the Mining Lease Application because 3% of the estimated cost of the scheme has not been deposited with the application as Bank Guaranty as required by the Rules. It is to be noted that 3% of the total estimated cost — $12,460 million (capital cost $2090 million + operating cost $10,370) is $373.8 million, i.e Tk. 2, 616 crore.

In brief, according to the expert committee, the contract and exploration license which Asia Energy received from BHP have no legal basis and the so-called mining lease (without permission of mining!) granted to Asia Energy under this contract is also legally invalid. That’s why there was nothing wrong or erroneous when Energy and Mineral Resources Division Secretary Abu Bakar Siddique said: “Asia Energy has no valid licenses to develop Phulbari coal mine” (Daily Sun, 8 Dec 2014).

Therefore, the government of Bangladesh (GOB) has no legally binding obligation to allow Asia Energy to do open pit mining and mining related activities in Phulbari, and there is no question of damage payment to Asia Energy for scrapping the Phulbari project as feared by Mr. Syed Mansur Hashim. Rather, the GOB can easily reject its Feasibility Study and Mine Development Scheme for open pit mining following the recommendations of the expert committee.

In fact, the GOB has legal and moral obligation to scrap Phulbari coal project according to the agreement signed between the government of Bangladesh and the people (National Committee to Protect Oil Gas Mineral Resources Port and Power represented the people) on August 30, 2006. The agreement was fully supported by the then opposition leader and current Prime Minister Sheikh Hasina. The main point of the agreement was: “Phulbari coal project will be scrapped and Asia energy will be ousted from the country.” It is now the duty of the GOB to implement its legal and moral obligation to the people by taking action against illegal activities of Asia Energy.

15th February. On Monday up to 500 people declared a hunger strike and indefinite protest against the planned expansion of Vedanta subsidiary Sterlite’s copper smelter in Thoothukudi (Tuticorin), Tamil Nadu. Two days into the protest police rounded up and arrested 270 people including many women and children, eventually releasing all except eight so-called […]

18th Jan 2018 In the third major London case against Vedanta subsidiary Konkola Copper Mines (KCM) since 2014, the English High Court on January 2nd ordered KCM to pay $139 million plus costs to Zambian government entity ZCCM Investment Holdings (ZCCM-IH) for sums owed as part of a copper and cobalt price participation agreement dating […]

12th December 2017. Despite the cold, a loud and theatrical protest was again held outside the AGM of British mining company Global Coal Resources Management (GCM) at the Aeronautical Society in 4 Hamilton Place in London at 10am today. In solidarity with the communities in Phulbari, where three people were shot dead as paramilitary officers […]

20th October 2017. On Tuesday the Securities and Exchange Commission filed a fraud case against Rio Tinto and two of its executives Tom Albanese (until recently Vedanta’s CEO) and Guy Elliot for inflating the value of a misguided coal deal with Mozambique in 2011. Rio Tinto was immediately fined £27.4 million by the Financial Conduct […]

13th October 2017. Judges today threw out Vedanta’s appeal to the May 2016 High Court judgment allowing Zambian farmers to have their case against the company heard in the UK. The judgment adds further weight to precedents holding UK companies legally responsible for the actions of their subsidiaries. Judges today released their verdict on Vedanta’s […] […]

7th September. This year was Vedanta’s 14th AGM, since registering on the London Stock Exchange in December 2003, and the 14th year that dissident shareholders have attended the meeting to hold the company to account for their environmental and human rights abuses. The minutes published by activist shareholders every year, documenting the company’s response […]

14th August 2017. Loud and theatrical protests were again held outside the AGM of British mining company Vedanta Resources’ at the Lincoln Centre, Lincoln Inn Fields, London at 2pm today accusing the company of major environmental and human rights abuses across its operations. Parallel protests and meetings were held today by affected communities and their [ […]

The annual Global Day of Action against Vedanta will take place on Monday 14th August 2017, as their AGM is conducted in London. While the Vedanta board try to don the ‘cloak of respectability’ of their London listing, communities affected by the company’s pollution, human rights abuses and tax evasion around the world will raise their […]

6th July. This report is a detailed account of hearings in Vedanta’s appeal against Justice Coulson’s 2016 judgment allowing the case of Zambian villagers polluted by KCM/Vedanta to be heard in the UK, which took place during the 5th and 6th July. At 9am on Wednesday 5th of July activists from Foil Vedanta Pan African […]

5th July 2017. The latest hearing in the case of the Chingola communities consistently polluted by Vedanta subsidiary Konkola Copper Mines (KCM) began at the Court of Appeals in London today. A rally organised by Foil Vedanta with Pan African solidarity groups took place outside the court in solidarity with the victims of ongoing pollution […]